* Asian stock markets: https://tmsnrt.rs/2zpUAr4
By Chris Prentice
WASHINGTON, May 21 (Reuters) - Asian shares were set for
another retreat on Friday as U.S.-China tensions curbed investor
risk appetite and caused global equity markets to stumble.
Hong Kong futures HSIc1 fell 1.59% and Nikkei futures
NKc1 were trading below the Nikkei 225 index's .N225
previous close, pointing to opening loss of 0.1%.
Australian S&P/ASX 200 futures YAPcm1 eased 0.13%.
Global equities pulled back after Beijing was set to impose
new national security legislation on Hong Kong. The move drew a
warning from President Donald Trump, who said the United States
would react "very strongly" against it. The back-and-forth between the world's two largest economies
stoked worries that the tensions could threaten "Phase 1" of a
U.S.-China trade deal reached early this year.
That prompted Wall Street shares to slip from the two-month
highs made in the previous session on hopes of a economic
recovery as governments began to lift their coronavirus
restrictions.
The majority of the 11 S&P sector indexes declined, leaving
the main benchmark S&P 500 .SPX down 0.78%. Dow Jones
Industrial Average .DJI finished down 0.41% and the Nasdaq
Composite .IXIC fell 0.97%.
The U.S. dollar, seen as a safe-haven, rose amid those
concerns. The dollar index =USD , which measures the
greenback's strength against six major currencies, was up 0.1%.
Spot gold XAU= , also typically seen as a risk-off option,
was little-changed after losses of 1% as investors booked
profits or opted for cash.
Brazil's real BRBY jumped after the central bank said it
was ready to increase support for the currency. The country is
expected to soon become the second-worst hit globally by the
pandemic as cases approach 300,000. Crude oil futures LCOc1 rose to their highest since March,
as recovering demand and production cuts offset investor jitters
seen in other markets. "Thus far, traders were right to call a trough in global
demand in April," AxiCorp Chief Global Markets Strategist
Stephen Innes said in a daily note. "Still, oil prices will
remain sensitive to any hint that the easing of global lockdowns
might result in the 2nd wave of COVID-19 infections and,
therefore, a more protracted impact on demand."
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Tracking the spread of the novel coronavirus https://graphics.reuters.com/CHINA-HEALTH-MAP/0100B59S39E/index.html
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